Nitin Gadkari Suggests GST Reduction To 12% For Hybrid Vehicles

In a recent media conclave, the Minister of Road, Transport, And Highways, Nitin Gadkari suggested that the Gross Service Tax (GST) on hybrid vehicles should be reduced to 12 per cent. He further revealed that he has urged the Finance Minister to take this issue up at the upcoming GST council meeting which would further boost sales. 

Moreover, the minister also cited that since hybrids are 60 per cent electrically operated, it has minimum pollution levels which makes it similar to electric vehicles. Currently, electric vehicles attract a GST of 5 per cent, and hybrid vehicles in comparison are taxed at 48 per cent which is unfair. As a result, the latter ends up with a higher price tag which in turn tends to push consumers away, especially when they find the same model with an ICE engine available with more features. 

Additionally, there are different classifications for hybrid vehicles. Models like the Toyota Urban Cruiser Hyryder, and Maruti Suzuki Grand Vitara, are classified as fully hybrid vehicles as both vehicles function with a fixed battery that is charged by the engine and regen braking. Coupled with a large fuel tank, these vehicles end up with more than 850 km of range in a single tank. 

(Also Read: Not Looking At Bringing Hybrids To India Yet: Hyundai India)

Then there are plug-in hybrids like the BMW XM, available with an AC charger (a 7.4 kW unit) to charge the battery separately. The range might not be at par with fully-hybrids, but it comes in very handy, especially in choc-a-bloc traffic situations, since the car functions on battery power only, thus conserving fuel. Therefore, the operational cost of such vehicles any day supersedes the likes of conventional petrol vehicles, which makes it the next obvious green choice over ICE vehicles. And Nitin Gadkari was talking about these two types of hybrid vehicles. 

While hybrid powertrains are more common in four-wheelers, especially private vehicles, there are no two-wheelers with this tech yet. However, manufacturers like Bajaj are working on introducing a new green alternative in the form of the world’s first CNG Bike. You can learn more about the same by heading over here.